It sounds like a simple question, but like so much in life, and particularly when it comes to doing business with the federal government, the answer can be more complicated than you might think…
The Small Business Administration sets the standards that define a business as ‘small’, and applies different size standards to different industries. Some size standards are based on average annual receipts for the last 3 years, others are based on the number of employees ( full and part-time).
When you register at the System for Award Management (SAM), you include the Industry codes (NAICS codes) that best describe your type of business – the products or services you offer. Since you can list as many codes as are appropriate, you may be considered ‘small’ under one NAICS code, but not under another.
- A construction firm is considered ‘small’ if their annual average receipts are less than $36.5 M; while an electrical or HVAC business is ‘small’ if their receipts average less than $15 M.
- The size standard for Carpet Cleaning services is $5.5 M; for Landscaping services is $7.5 M; and for Janitorial services is $18.0 M.
- As a general rule, the size standards for most manufacturing industries generally range between 500 and 1,000 employees.
- Professional services size standards vary widely–from $7.5 M for Graphic Design services, to $27.5 M for Computer Programming services.
When a solicitation is set-aside for a small business, it will apply to a specific NAICS code, that the Contracting Officer has decided is most appropriate.
If you find a solicitation has been assigned a NAICS code that you feel is incorrect, you should first contact the Contracting Officer, who may choose to correct the NAICS designation if appropriate. You may also choose to challenge the NAICS code designation by filing an appeal at the Small Business Administration (SBA), within 10 days of the solicitation being issued.
Find out more information on size standards on the SBA’s Size Standards page